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How to Avoid Mistakes when Reporting
Posted on 31st August 2017 in The Forecast
Written by Freya Hughes
Ever felt like something’s not quite right? You might remember a few years back, the BBC’s Simon McCoy was centre focus of quite the blunder as he grabbed a stack of printer paper instead of his iPad. On live TV. It had the country in hysterics for a time (especially with the ‘drunk tank’ backdrop), but what happens when you make a mistake on your business reporting? It definitely won’t be a laughing matter, I’m afraid, but this blog will prepare you for what could go wrong, before it does.
Cloud automation significantly reduces risk factors in reporting. Using FUTRLI’s flexible date options you can quickly and simply select the appropriate date range for your report, and know the data is correct. Because of our seamless integration with Xero and QuickBooks Online, you can trust that everything you put in is exactly as it was on your cloud accounting platform. On occasion, spreadsheet blunders can impact business in a big way. We hear on the internet and news when these mistakes become uncontrollable. The impact can be huge, costing companies around the world billions. And these mistakes aren’t just issues with time and money but also lead to damaged reputations, lost jobs and careers.
One memorable example of spreadsheets costing businesses is ‘that time JP Morgan used a manual copy-and-paste model and lost loads of money’, as The Mirror call it. They report that they were attempting to create a new value at risk (VaR) model, which would determine their hedging strategy. “It was reliant on copying and pasting over several spreadsheets. And it also divided rates by their sum rather than their average as intended, meaning the volatility was out by a factor of two, thus lowering the perceived risk of assets.” Long story short, JP Morgan reported losses of 2 billion dollars that year.
To help you make sure you don’t end up like them, let’s look at how FUTRLI allows you to reduce errors…
Reporting on your figures can be a stressful undertaking, especially if you’re not using automated technology. You know you need to get it right; there are pretty severe consequences if you don’t. You know you can rely on Xero and QBO’s tech, so here are a few things to watch out for to ensure you don’t make any mistakes.
Let’s look at the process of reporting. In FUTRLI, all you need to do is edit your time frame. This is down to the automated data coming in from Xero:
- Ensure that your card is in ‘Edit’ mode and that the ‘Settings’ tab on the back of the card is selected. This is where you can edit your report’s date range.
- Clicking the first date range dropdown and then selecting the ‘Custom Period End’ will allow you to select any date to run a report from.
- Then you need to select how you want to report on your data, and how many periods you need to view. Save it, and you’re done!
From this breakdown, you can see that the only space for error is if you accidentally input the wrong dates. Mistakes are a natural part of life but there’s little to no risk here.
Using a template will get you used to the way it works. Use the templates available (or create your own), copy them and scale up with automation. For banks, investors and your team, it shows you the past, present and future all in one place.
But it’s not just when you’re setting up your reports that you could encounter issues. Once you’ve got your figures into FUTRLI, there are a handful of things you can do, or fail to do, which could impact your data.
For example, if you’re pretending to understand the numbers in front of you, while really having no idea what the implications of them are you could well be stunting your business’ growth. Of course you want and need to understand what’s happening to your cash, but if you’re looking at the report and scratching your head it’s definitely time to get your accountant on the phone. FUTRLI is set up in a way that allows you to view your reports in quite a few different ways: pie charts, bar charts, graphs and tables. Visuals often have much more of an impact for people than a ‘wall of numbers’. And considering patterns in figures are more easily identified with visual data, you’ll begin to understand what your numbers mean soon.
It’s good practice to be in the habit of displaying your data in an easy to understand format. From board meetings to team meets, the people involved in your company need to know what goals are being worked towards. Additionally, if you’re presenting your data in a visual way, then you’d do well to do the same for your marketing. It’s widely believed that we process visual information 60,000-times faster than text. Visuals hit viewers in a visceral way, so consider this next time you’re required to present your business to the world.
Make the most of available services
When you can’t get your head around something, it’s best to consult a professional. Regular meetings with a management accountant, VCFO or advisory accountant will help you to drill down into your figures and really start to understand them. There’s no better person to be in touch with, and you need to make sure your meets are frequent, as businesses evolve and shift so much in such short spaces of time. You’re putting yourself at a massive advantage over competitors by using real-time data, so you need to make sure you’re making the most of it. Combining up to date data with the ability to forecast what might happen next will see you making business-changing, confident decisions. Your accountant should be able to help you strategise to meet targets and goals too. All of these services are out there waiting to help you so get out and speak to your accountant.
Measure in smaller portions
If you measure KPIs, you’re going to be able to see a departmentalised break down of how every part and every person involved in your business is performing. Having the ability to divide each part of your business up means there will be more to pay attention to, but while in smaller, more digestible portions means you’ll reduce error. If you’re attempting to keep a grip on the ins and outs as a whole, it can become overwhelming so don’t make yourself do harder work than necessary.
Speaking to Owner of tourist attraction Crystal Castle, Australia, recently Naren King told us he’s able to live remotely in Bali while checking in on his business via KPI measurement. His team of 60 all work towards the same goals, and the managers lead meetings with their KPI results for a given period. Tracking his main revenue streams allows him to log in to FUTRLI and ascertain how well each department is performing, with a few clicks, remotely. With managers leading with their key metrics, each employee understands their responsibility to the business’ bottom line. Read the full case study with Naren here. Frankly, if that’s not living the dream I don’t know what is!
If you need a bit more help with KPIs, swing by our fully-stocked KPI Library and check out our industry-specific KPI lists.
You’re taking risks by not reporting your data with automated software. You’ll know, and be able to trust, that your numbers are accurate and you can use those to strategise your next moves. Because of the nature of business, you cannot afford to be taking risks without knowing there’s a good chance they’ll pay off. We looked into what makes entrepreneurs risk takers or risk averse, which you can read here. The core differences are:
- A risk taker will gamble their assets in the hope of achievement
- The risk averse would choose options that mean fewer risks, and prefer familiarity
So even if you enjoy the buzz of taking risks, you need to sway the odds in your favour. Get your reporting on the cloud, forecast your future figures, all the while being able to check in on your granular information at the tap of your screen.